Month: December 2016

The year 2016 was so “post-” (or “meta-“, to insist on the Greek) that it is closing quite literally with the very last Last Christmas*. As an end-of-year salute we proudly present the 10 most read blog posts of 2016 on Dateline: Atlantis, recalling some of its weirdest moments from a Greek perspective.

Now gird your loins and sharpen your wits for 2017. Rumour has it that Pangloss and Polyanna are preparing to co-author a coping guide (foreword by F. Fukuyama). It must be true, ’cause I read it on Facebook.

I have heard this informal transaction described independently by more than one person, leading me to believe that it is not apocryphal:

Around late October/early November you are trying to progress some business with a government office – it could be a tax registration or a planning application, or something along these lines. You have the name of the official responsible for your application, but they are proving very hard to get hold of. Each time you call the office, you will get the same response: “Mr Táde (So-and-so) is not in the office today. He is at his village gathering the olives. I’m sorry but we don’t know when he will be back.”

To the uninitiated, this is an annoyance, but not a deterrent. They will keep trying, hitting their head against a brick wall, cursing all the way at the [expletive] civil service culture of absenteeism.

However, those in the know recognise this line as a coded invitation to tender, to which there is a proper response: “Oh, that is so nice. I hear Mr Táde’s trees produce very good oil. Would you be so kind as to ask him to reserve some for me?” And very soon they will find that Mr Táde has returned from leave, and can be found promptly behind his desk with a couple of five-litre tins of olive oil. They will pay Mr Táde a highly inflated price for the oil (which may be good, but not thatgood) submit their application, and find it dealt with with great efficiency – the efficiency of a well-oiled machine…

The transaction described above is an inventive riff on the twin themes of the family olive grove as hobby for city-dwellers, and olive oil as a buffer against hardship, which we alluded to in a previous post.

When the Greek government recently looked into the impact of withdrawing some of the generous tax breaks for farmers, one of the patterns that emerged was that, according to one newspaper report,

Only about 350,000 of the 850,000 Greeks involved in farming are full-time farmers, said an agriculture ministry official, adding that a third of agricultural output is sold or traded illegally without receipts.

Olive farming in Greece is largely a family business, with small units predominating. Greek agricultural units overall are roughly one fifth the size of the European average. What they do with their output often blurs the lines between different types of economic activity, several of which are not tracked by EUROSTAT or the OECD.

While the ‘grey’ market for olive oil may be thriving, Greece finds it harder to make a success of the ‘white’ market. In the case of olive oil, although the oil produced is very high quality (80% of Greek olive oil is extra virgin, compared to 65% of that produced in Italy and 30% in Spain), those countries have a much more valuable export market because they tend to standardise and package their product themselves, rather than loading it into tankers and exporting it in bulk (Greece only standardises 27% of its oil, compared to 80% in Italy and 50% in Spain). 60% of Greek olive oil is shipped to Italy, where it is bottled as Italian, and the Italian middle-men pocket an extra 50% premium on the price.

The theme of this story is a familiar one – a true Greek paradox. We seem to be blessed with some enviable natural resources (there is no other elegant word for it without resorting to statistical jargon, since their presence is clearly down to luck, not skill or hard work). We are clearly not lacking in the ingenuity to make a market in them. And yet, it is not a market that connects well with the wider world, and it is questionable whether it benefits anyone beyond the atomistic units that practice it (the individual, the family). Trying to imagine what might happen if that ingenuity were channeled from the ‘grey’ or ‘black’ economy into the ‘white’ is a an exercise at once hopeful and depressing. Figuring out how to achieve it is surely the €100 billion challenge behind the resurrection of the Greek economy.

Like this:

Today, 2 December 2016, GreekiLeaks™ publishes a partial transcript of a phone call between President-elect of the United States Donald Trump [PEOTUS] and the Prime Minister of Greece, Alexis Tsipras [AT], obtained through a confidential source. On 23 November, Tsipras spoke with Trump to congratulate him on his victory in the U.S. presidential elections. Trump is speaking from his private headquarters in Trump Tower. Only one end of the conversation was recorded. Its authenticity has been verified by comparison to official records of recent communications with world leaders.

AT: [inaudible]

PEOTUS: Thank you, Alexis, I am truly honoured. You are a terrific guy. You have a beautiful country and very very talented people. The Greeks are one of the most intelligent people. First thing I said to my campaign team, look at these guys! Look how they said a proud “NO” to the elites in Europe, drained the swamp, and made their country great again. They have a world-leading truther industry. And this guy, this guy took on the lying, corrupt media and won, right?

AT: [inaudible]

PEOTUS: We will have a beautiful relationship. You know why? Because we both keep our word.

AT: [inaudible]

PEOTUS: Forget that guy. What was he doing walking around that building site in his casuals? Guy has no class. Before I go there, it’s gotta be finished. We need to add a few beautiful statues and some hot hostesses and at least one fountain. And don’t hold back on the gold leaf. It’s gonna be amazing. It’s gonna be the best temple to democracy on the planet. Then we need to clear a few acres around it and create an amazing golf course. It’s gonna be the biggest, most amazing golf course you have ever seen.

AT: [inaudible]

PEOTUS: I’m not interested in infrastructure. I’m only into beautiful things. Hotels, resorts, casinos, beauty pageants. The Chinese can keep the ugly stuff as long as they don’t think they’re running the show.

AT: [inaudible]

PEOTUS: Some very good friends of mine got killed buying your banks. I mean, they’re incredibly successful guys, they didn’t get killed, but they don’t like losing money. But I trust you Alexis, you have a great reputation, and I’m sure we can negotiate one hell of a deal to make them happy.

AT: [inaudible]

PEOTUS: Forget her, great leader but I’d give her a 2, maximum. She makes Hillary look like a 6. And the French one? Legs are a 10 but no one likes a ballbreaker. Such nasty women. The worst.

AT: [inaudible]

PEOTUS: Don’t talk to me about debt. Debt is for losers. Listen, Alexis. I am a businessman, a very successful one, and you need to learn to talk like a businessman too. We call it leverage. And don’t worry about paying it back, believe me. That’s what Chapter 11 is for. I’ve done it four times, and look at me. Don’t I look like a successful businessman?

AT: [inaudible]

PEOTUS: Yeah, just make sure you write “Alexi’s Greece” in big gold letters on everything. And keep the penthouse for yourself. Invite Hello magazine to do a spread with your beautiful wife and your beautiful, amazing, talented kids. Trust me, you’ll come out ahead. I’ll give you the name of my tax guy, you won’t pay a dime, cent, whatever, in taxes, the rest of your life. Doesn’t make you a loser – it makes you smart.

AT: [inaudible]

PEOTUS: Alexis, I guarantee you I will negotiate a deal on Cyprus and those other islands like you won’t believe. Tayyip is a great guy, great leader. Big in property. We speak the same language, we both have terrific taste. We’re gonna negotiate an amazing deal, I guarantee you. It would be an honour and I will personally do it.

AT: [inaudible]

PEOTUS: Just kidding, you’re not hired. Unless you want to be our man in Havana. Terrific development potential, just need someone who speaks Commie.

Thales, so the story goes, because of his poverty was taunted with the uselessness of philosophy; but from his knowledge of astronomy he had observed while it was still winter that there was going to be a large crop of olives, so he raised a small sum of money and paid round deposits for the whole of the olive-presses in Miletus and Chios, which he hired at a low rent as nobody was running him up; and when the season arrived, there was a sudden demand for a number of presses at the same time, and by letting them out on what terms he liked he realized a large sum of money, so proving that it is easy for philosophers to be rich if they choose, but this is not what they care about.

In other words, Thales made a small downpayment to secure the use of the presses when demand was low, and cashed in during peak season. He capitalised on his unique insight on the weather to corner the market in olive presses. Aristotle’s telling has the quality of an archetypal moral fable – “it is easy for philosophers to be rich if the choose, but this is not what they care about” – that readers can easily recognise in modern popular narratives of the financial crisis, like Michael Lewis’s The BigShort, the story of the oddball traders who saw the credit crunch coming.

The economy of Aristotle’s description does not allow us to determine whether Thales invented the future or the option, a technical distinction which would have made the difference between him losing his shirt or just his deposit, had he been proven wrong in his prediction. But that distinction is not essential to the story as it is told. Thales, the philosopher speculator, the first hedge fund manager, driven by the intellectual challenge rather than by the profit motive, may have invented the fruit of good or evil: an instrument for managing the risk of unpredictable harvests, or a tool for the enrichment of the ‘enlightened’ few at the expense of the many. A tale as old as the olive groves.